TeraExchange

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TeraExchange
Tera.jpg
Founded 2010
Headquarters Summit, NJ
Key People Christian Martin, CEO; Leonard Nuara, President
Products OTC cleared swap execution
Website www.teraexchange.com
 

TeraExchange is a trade execution platform for cleared OTC swaps, offering both a central limit order book (CLOB) and voice brokerage services.[1] The exchange is operated by Tera Group.

History

TeraExchange was founded in 2010 as an offshoot of Spring Trading, LLC, a proprietary trading firm based in Summit, NJ.[2]

In April of 2016, TeraExchange filed an antitrust lawsuit alleging that some of the biggest banks in the world had conspired to block customers from using trading interest rate swaps on its platform. The suit named Bank of America Merrill Lynch, Barclays, BNP Paribas, Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC, JP Morgan, Morgan Stanley, RBS and UBS, as well as two competing trading platforms: ICAP Capital Markets and Tradeweb Markets.[3]

Products and Services

TeraExchange filed an application to become a Swap Execution Facility (SEF) with the Commodity Futures Trading Commission (CFTC) on July 26, 2013[4] and received temporary registration from the CFTC to operate the SEF on September 19, 2013. [5]

It also plans to file with the Securities and Exchange Commission as a securities-based swap execution facility once the Dodd-Frank rules become finalized. All OTC derivatives will be listed on TeraExchange, including:

TeraExchange announced on March 24, 2014 that it would offer a swap based on the bitcoin, which would let investors hedge risk from trading the digital currency.[6] The launch would bring the bitcoin payment system under the oversight of U.S. regulators for the first time.[7] TeraExchange plans to list the bitcoin swap on its Swap Execution Facility (SEF).

Trading Tools

In addition to its core trading platform, TeraExchange also makes available two trading tools for complementary use by its market participants: TeraDirect, a front-end execution management system that displays all information and functionality needed to trade on TeraExchange, and TeraCheck, a proprietary pre-trade credit risk management engine that allows market participants and their clearing members to enter and maintain appropriate risk controls. Participants can connect via FIX, FAST, FpML and other protocols.[8]

Key People

Advisors: Duncan Niederauer and Noreen Harrington

References

  1. TeraExchange to Launch New Market for OTC Derivatives. Wall Street & Technology.
  2. TeraExchange to Launch Central Limit Order Book for Swaps and OTC Cleared Derivatives. PR Newswire.
  3. Trading start-up files antitrust lawsuit in New York. Reuters.
  4. TeraExchange Files SEF Application with CFTC. TeraExchange.
  5. TeraExchange Receives Temporary Registration as a Swap Execution Facility (SEF). digitaljournal.com.
  6. Bitcoin Swaps Near Reality as Tera Creates Legal Framework. Bloomberg.
  7. Tera Exchange announces first Bitcoin derivative. Reuters.
  8. TeraExchange Receives Temporary Registration as a Swap Execution Facility (SEF). digitaljournal.com.